Disquiet over moves by ‘ineligible’ investors to bid for NDPHCN power plants

Power stationConcern is mounting over allegations of emerging political interventions in the proposed sale of ten Niger Delta Power Holding Company Limited (NDPHC) generation companies, following surprising appearance of hitherto disqualified bidders amongst those prequalified for financial evaluation.
The NDPHC and the Bureau of Public Enterprise (BPE) are in the process of selling ten electricity generation companies developed under the National Integrated Power Project (NIPP). The plants include NIPP plants in Alaoji, Benin, Calabar, Egbema, Gbarain, Geregu, Ogorode, Olorunsogo, Omoku and the Omotosho Generation Company.
Of over 50 bidders that applied for the purchase of the power plants last year, about 42 have been prequalified ahead of the financial bids opening, leaving out about ten bidders for various reasons ranging from technical incompetence to clashes of interests and breach of market rules.
Competent government agency sources have however revealed that some companies already disqualified are beginning to reappear on the list after what was called “intense lobbying and pressure from very powerful government quarters”
In the case of the Omotosho power plant for instance, six companies were initially technically prequalified after more than a dozen had bidded. “The number grew to nine overnight after interventions from some powerful government individuals, even in breach of market rules”
One of the basic market rules precludes entities already having dominant interests in the previously sold Power Holding Company of Nigeria (PHCN) properties, like the Distribution Companies, from participating in the bids for the NDPHC generation entities. The market rule seeks to prevent the emergence of monopolies in the generation and distribution of power, to eventually protect consumers from the negative consequences of monopoly, especially in a fledging economy like Nigerians’.
Credible sources specifically cited two cases of potential monopolistic domination even against the grain of the philosophy as it concerns a partner in a South West DISCO also vying to buy one of the plants and another core investor in a PHCN Phase 1 power plant also bidding for another, even after they have been technically declared ineligible.
The source added that “the parties involved had gone to politically lobby themselves back to the lists, in what is beginning to raise transparency questions on the planned sales”.
Reports earlier said the Finance Minister and Coordinating Minister of the economy, Dr. Ngozi Okonjo-Iweala had in a meeting with NPDHC and the National Privatisation Committee (NCP) raised issues on the credibility of the some of the bidding firms, eventually leading to the identification and removal of some names from the bidding list. Some of those initially excluded are now resurfacing, and supposedly ready for the imminent technical evaluation.
The proposed sale of the NDPHC plants is pursuant to the ongoing unbundling of PHCN, which has witnessed the sale of some generating companies and 11 distribution companies in the country. The sales are part of government holistic plan of ensuring stable power supply.

No tags for this post.